Early embryonic lung development, particularly early branching morphogenesis, is controlled by epithelium-mesenchyme interaction, in which autocrine/paracrine growth factors, including BMP4, are involved. This proposal is focused on determining the mechanisms by which BMP4 induces lung branching morphogenesis in mouse. Hypothesis: BMP4 induces mouse embryonic lung epithelial branching morphogenesis in a mesenchyme-dependent manner through activation of specific downstream signaling proteins. Specific Aims: Aim 1. To determine mesenchyme mediated inductive mechanisms of BMP4 on epithelial branching morphogenesis of E11.5 mouse embryonic lung. Aim 2. To define gene expression pattern, specific activation, and biological function of specific BMP4 receptors and downstream Smads during BMP4 induced embryonic lung branching morphogenesis. Aim 3. To determine the biological roles of specific negative regulators (Gremlin, NMA, and Smad6) of BMP4 signaling during embryonic lung branching morphogenesis. Health Relevance: The studies will provide fundamental knowledge about BMP4 and lung development, which will help us to better understand congenital and neonatal pulmonary diseases as well as lung injury repair. This basic information may aid in the future design of novel therapeutic strategies to prevent and treat such serious pulmonary diseases as lung hypoplasia, bronchopulmonary dysplasia and emphysema.